E001095
 EXCISE DUTY – use of motor vehicle on road fuelled by rebated fuel – quantum of the assessment – appeal dismissed

	
MANCHESTER TRIBUNAL CENTRE 			   

 
 	
	SIMON CLARK	Appellants

	- and -

THE COMMISSIONERS FOR
	HER MAJESTY’S REVENUE AND CUSTOMS	Respondents

				Tribunal:	LADY MITTING (Chairman)
						MOHAMMED FAROOQ (Member)		

Sitting in public in Birmingham on 25 February 2008

The Appellant appeared in person

Bernard Haley, counsel, instructed by the Acting Solicitor for HM Revenue and Customs for the Respondents 

	© CROWN COPYRIGHT 2006

DECISION

1.	The Appellant appeals against an assessment to excise duty in the sum of £1,278 dated 13 July 2006, issued pursuant to Section 13(1A) Hydrocarbon Oil Duties Act 1979 (HODA)

2.	The Appellant represented himself and gave sworn oral evidence

3.	On behalf of the Commissioners we heard oral evidence from the assessing officer, Ms. Dawn Clennett, and the reviewing officer, Ms. Angela Cook.  Witness statements had been served by the Commissioners from officers Richard Spotwood and Andrew Harper and had not been challenged by Mr. Clark

4.	15 May 2006, Officers Spotwood and Harper visited the premises of one Frank Gilson who traded as Gilson Same Day Courier.  Fuel samples were taken from a Citroen dispatch van registered number SL51 0UD.  The tank was found to contain rebated oil (red diesel).  A second vehicle on the premises was also tested and found to contain nothing other than duty paid diesel.  Mr. Harper questioned Mr. Gilson under caution and was told that Mr. Gilson had purchased the vehicle on 4 July 2005.  he himself had never used it as it had been used solely by a subcontractor, Simon Clark, the Appellant.  Mr. Gilson said that Mr. Clark had sole responsibility for fuelling and maintaining the vehicle and he himself had never fuelled it or used it.  The vehicle had been in the possession of Mr. Clark from 4 July 2005 to 10 April 2006, when it was returned to Mr. Gilson.  He told Officer Harper that the vehicle had done 45,015 miles since ownership.

5.	Officer Spotwood visited Mr. Clark and, under caution, questioned him.  He confirmed his use of the vehicle, describing the arrangement for it as “pay as you go”.  He confirmed that he had been responsible for fuelling it; he had done approximately 40,000 miles in it and that he kept his fuel receipts but sometimes he forgot to or threw them away by accident.  In the main he purchased with the use of a credit card.  He confirmed that he had filled the vehicle up with red diesel on one occasion approximately a week before he returned it to Mr. Gilson, the purpose of this being to clear the injectors out.

6.	The detection report and interview notes were then examined by Ms. Clennett who concluded that Mr. Clark was liable for using the vehicle with marked rebated fuel and subsequently it was he who should be assessed.  Mr. Clark was asked to submit as much evidence as he could to record his fuel purchases and a number of receipts and bank statements were submitted by him, which Ms. Clennett then analysed.  Ms. Clennett scheduled every single receipt and every entry on the bank statements which could have related to the purchase of fuel.  She prepared a second schedule of receipts which she had discounted, annotating against each entry their reason for being rejected.  The reasons were variously that the date of purchase could not be ascertained and it could not therefore be established that the purchase took place within the period of assessment; the receipts were prior to the vehicle having been given to Mr. Clark; four receipts post dated the return of the vehicle to Mr. Gilson and, finally, there were six receipts discounted as they reflected purchases from JD Boat Services who did not sell white diesel at all.  This process recorded what Ms. Clennett took to be the legitimate purchase of white diesel of 3,274.05 litres during the period of assessment.

7.	Ms. Clennett’s assessment was carried out in the following way.  Mr. Gilson had stated that the vehicle had covered 45,015 miles from the date of ownership to the date of detection.  He stated that he had never fuelled or used the vehicle since ownership and all these miles were therefore attributed to Mr. Clark.  We assume that Mr. Gilson established this mileage figure from a combination of the mileage given on the MOT certificate which immediately pre-dated the purchase (16,996 miles) and the mileage figure detection (62,011).  The period of assessment was taken from 4 July 2005 when the vehicle was passed to Mr. Clark until 10 April 2006 when it was returned to Mr. Gilson.  This was a period of 281 days and using departmental guidelines of 34.3 miles to the gallon, Ms. Clennett assessed that to cover this mileage the vehicle would have used 5,966.128 litres.  Mr. Clark’s records recorded the legitimate purchase of 3,274.05 litres leaving a shortfall of 2,692.078 which, over the period, worked out at 9.5 litres per day.  The assessment period fell into two separate duty rate periods and, having made this distinction, Ms. Clennett assessed the revenue shortfall at £1,278, which said sum was duly notified to Mr. Clark.

8.	Mr. Clark made written representations to the Commissioners explaining that he had had a number of personal problems including a house move and that Mr. Gilson had had the vehicle back for some time before the date of detection and that he had put in as much evidence as he was able to.  It fell to Ms. Cook  to review the assessment and she upheld it, being satisfied that it had been calculated correctly, both mathematically and using correct methodology.

9.	Under Section 12(2) HODA it is not permitted to use rebated fuel in a road vehicle.  Section 13(1A) HODA allows the Commissioners, where fuel is taken into a vehicle in contravention of Section 12(2), to assess an amount equal to the rebate and to raise that assessment against the person responsible for its use.

10.	Mr. Clark told us, in his oral evidence, that he had used red diesel on only four or five occasions in the vehicle, on each occasion the purpose being to clean the injectors out.  He knew it was not legal to run the vehicle on red fuel.  The receipts he had submitted were the only ones he could find as he lost a number in a house move.  He had found some others which were not dated and which he did not submit as they would have served no useful purpose.  Equally on occasion he had filled up but forgotten to ask for a receipt.  It was therefore his contention that the receipts used by the Commissioners to record his purchase of legitimate fuel produced an under-quantification.  He was not able to say whether the mileage figure used by Ms. Clennett was correct.  There had been a number of weeks between the vehicle being returned to Mr. Gilson and its detection and Mr. Clark just did not know whether it had been used in the meantime by Mr. Gilson or indeed any other person but, as he pointed out, it was perfectly possible for it to have been so used.  He did not dispute the dates of the assessment period but stated that his purchases of red diesel were so few that the assessment was excessive.

11.	We explained to Mr. Clark that the onus of proof before us was on him, which he understood.  It is most unfortunate that he could provide no further evidence of his purchases of legitimate fuel and that there was no record of the precise mileage at the date of surrender of the vehicle.  On the evidence before us, we cannot fault the approach taken by the Commissioners.  Mr. Clark did not dispute that it was correct to assess him as he had the use of the vehicle and had been responsible for refilling it.  The period of assessment is correct and is accepted by Mr. Clark.  Ms. Clennett used the only information available to her as to the mileage.  She gave credit for every possible receipt that she could and no others have since been produced.  Mr. Clark has been unable to show to us that the assessment is in any way incorrect and his appeal therefore has to be refused.

12.	The appeal is dismissed.  Mr. Haley made no application for costs and no order is made.

MAN/2007/8002

Lady Mitting
CHAIRMAN
Release Date: 14 March 2008